The Cost of Health Disparities

SPEAKER_1 (0:00)

Welcome to Advancing Health. Differences in health outcomes affect patients and communities, but also contribute to lost workforce productivity and hundreds of billions of dollars in avoidable health care spending. More health care leaders are recognizing these challenges and taking action.

Jorie Roden (0:18)

This is Jorie Roden, Senior Vice President for the Division of Health Outcomes and Care Transformation at the American Hospital Association. And today we're going to be talking about the economic impact of disparities in health outcomes.

Health disparities have long been recognized for their impact on patient outcomes. But we know that they also carry significant macroeconomic and microeconomic impacts and consequences.

At the macro level, I'd like to share just a few findings from our research as we developed this guide for the field. The data from 2022 show that national analyses estimate that disparities in health outcomes are associated with approximately $320 billion, with a B, in excess health care spending each year. With projections indicating that this figure could actually rise to $1 trillion by 2040 if disparities remain unaddressed. I don't think this is a problem we can ignore. So our members often ask, why in a resource-constrained environment, should they pay attention to and invest in strategies that will reduce health disparities? And today, I am joined by Brian Peters, Chief Executive Officer of the Michigan Health and Hospital Association. Brian and I will discuss how health disparities, not only impact health outcomes at the individual level, they drive avoidable costs across health care systems, they reduce workforce productivity, and lead to excess health care spending and expenditures for individuals, families, and society writ large. Brian, thank you for joining me today. And I'd like to invite you to introduce yourself a little bit better than I did, and share just a bit about the work you're leading in Michigan.

Brian Peters (2:29)

Well, thank you, Joy. It's a pleasure to join you today and talk about this very important subject. The Michigan Health & Hospital Association has been around for a while. We just celebrated our 100-year anniversary a few years ago, and we've been a very strong advocate for literally every hospital and health system in the state of Michigan. They are all engaged members and good standing of our association. We partner with the American Hospital Association, both on the advocacy front, but also on a number of other issues outside of the public policy arena as well. And our mission is very straightforward. We advance the health of individuals and communities, and that's a mission that's very consistent, almost identical with the American Hospital Association. And I think that's given us a really excellent platform to collaborate on this work.

I will tell you that it has been a great privilege for me to serve at the MHA for now 37 years, the last 11 as CEO, and to serve on the American Hospital Association Board as well with some really remarkable leaders. And I'm just so proud of the work that we're able to do together.

Jorie Roden (3:43)

Well, thank you so much for your strong leadership, and certainly for the tight coordination that we enjoy with you and your other state hospital association peers, really leading the charge to improve the conditions so that our hospitals can continue doing the good work that they do for the communities they serve. So to get us started, we often think about health disparities in terms of patient level outcomes. And we talk a lot about the moral imperative to act.

I think an underexplored area, Brian, is the economic impact of those same disparities. And so I wonder if you could shed some light on why you think health care leaders should pay attention to the financial considerations that can sometimes be overlooked.

Brian Peters (4:38)

Well, there's no question this should be a main focus. And, you know, I'm someone that always looks at the optimistic view anytime we're dealing with major challenges. And so, as you know, Joy, both for the American Hospital Association, for the Michigan Health & Hospital Association, and frankly, for our colleagues all over the country, what is the hot topic, if you will, right now?

It is an election year topic, and that is the topic of affordability. And I think we're all wringing our hands about this issue. And, you know, we've been called to task. Why are health care costs so high? I think we've been given a gift, quite honestly. This is my optimistic view, because this new conversation on affordability, it's shining a very bright light on the underlying factors. And what I'm getting at here is, when we talk about disparities, and as you said, the economic impact of disparities, now we have the full attention of everybody from, you know, our own membership to elected officials, the media, and the business community, to talk about the role that economic impact plays when it comes to these issues of disparities. We can make that very close connection. And so this is an opportunity that we don't want to squander. And I'm very pleased to see the American Hospital Association wading in in a very significant way. And with this new report, I think it's going to really help our efforts in a significant way.